The Queensland business community has greeted the 2008 State Budget with caution.

The Budget has delivered vitally needed infrastructure and commences the long process of re-establishing a competitive tax environment, but offers only limited monetary benefit to individual businesses. 

The Budget papers confirm Queensland is no longer the low tax state and is now in the middle of the pack.  Further steps to improve our position in the tax rankings will have to be taken to promote ongoing economic growth.

Commerce Queensland strongly supported the move to improve arrangements relating to the payroll tax exemption threshold.

In general, the Budget moved in the right direction but Commerce Queensland believes that it could have gone further with more initiatives to reduce the cost of doing business in Queensland.

For further information please contact Nick Behrens, State Manager – Policy, by email at nbehrens@commerceqld.com.au.

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The Reserve Bank of Australia (RBA) board has met recently and decided to keep interest rates on hold.

Commerce Queensland strongly believes that with the economy appearing to be slowing and the impact of the previous interest rate increases not yet being fully felt across the economy, that no case can presently be made for higher interest rates.

For further information please contact Nick Behrens, State Manager - Policy, at nbehrens@commerceqld.com.au.

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Commerce Queensland is very concerned that a number of flights to and from Queensland will be cancelled.

Commerce Queensland is now seeking to establish whether these arrangements are temporary or whether the airlines are now assessing the ongoing commercial viability of these flights.

The reduction in air services greatly increases the inconvenience and difficulty in getting to remote areas such as the Whitsunday's and Far North Queensland. Queensland's prosperity has always been influenced by its accessibility and the perception of remoteness from the rest of Australia. 

There is no doubt that Queensland remains both nationally and internationally a destination of choice.  The reduction in services will weaken our tourism industry.  Commerce Queensland is also highly critical at the lead time for these decisions and the relative absence of prior consultation.

For further information please contact Nick Behrens, State Manager – Policy, at nbehrens@commerceqld.com.au.

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The Queensland Government has released details of a proposal to raise the Building and Construction Industry (Portable Long Service Leave) Levy from 0.125 per cent to 0.2 per cent. This increase, based on independent actuarial advice, is considered necessary by the State Government to ensure the long term viability of the Building and Construction Industry (Portable Long Service Leave) Scheme.

Commerce Queensland is currently preparing a detailed response and is extremely interested in members' feedback on this issue.

For further information or to provide feedback please contact Nick Behrens, State Manager – Policy, at nbehrens@commerceqld.com.au.

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The Queensland Government and the Queensland Water Commission (QWC) recently released the proposed 10 year price paths for bulk water supplies in South-East Queensland.

Given that the increases appeared to be higher than previously indicated, Commerce Queensland met with the QWC to discuss the assumptions underpinning the price paths in more detail. The QWC asserts that the cost of acquiring existing council-owned assets ($2 billion) is built into the 2007-08 charges, while the $9 billion invested in new water grid assets will be recovered through a gradual increase in the region's bulk water supply charges over the next 10 years.

In terms of inflation-adjusted prices, the annual increase in household and business prices attributable to higher bulk water charges will be $0.296 per kilolitre over the next two years. Both the retail and bulk water charges may vary from the expected price path over the period 2010-11 to 2017-18 if the factors underlying the price paths alter.

For further information please contact Sarah Kearney, Senior Policy Advisor, at skearney@commerceqld.com.au.

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Commerce Queensland recently met with the Environmental Protection Agency (EPA) to discuss the proposed changes to the legislation governing the environmental remediation of sites following industrial accidents. As previously advised, these changes will make landlords and other parties (e.g. directors) liable for costs of off-site environmental remediation where the pollution originated from an industrial accident on their property.

Commerce Queensland raised a number of concerns during the course of the discussion including:

• the economic impacts of the proposed requirements;
• the fact that it did not appear a detailed assessment of the economic impacts of  the proposed changes had been undertaken;
• the possibility that insurance coverage may not be available or may contain considerable exemptions and/or be prohibitively expensive;
• the appropriateness of shifting liability/risk to the landlord in these circumstances; and
• the potential for the actions of third parties (e.g. fire service) to exacerbate the environmental damage, resulting in higher remediation costs.

Commerce Queensland also asked whether the EPA had considered alternative options. The EPA was receptive to our concerns and agreed to further consider our request for a detailed assessment of the economic impact of the changes and alternative options.

For further information please contact Sarah Kearney, Senior Policy Advisor, at skearney@commerceqld.com.au.

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Commerce Queensland has conveyed the business community's opposition to funding a National Paid Parental Leave Scheme through a detailed submission and an appearance at this month's Paid Parental Leave Inquiry public hearing.

Commerce Queensland has made a strong argument supporting the view that business should not be forced to bear the financial burden for a National Paid Parental Leave Scheme. Furthermore, Commerce Queensland put forward the idea that improving measures to help meet a growing demand for child care would materially contribute to increasing workforce participation by those of working age in our community.

A key recommendation from this process must be to ensure existing employment regulation is flexible to allow employers and employees to negotiate mutually beneficial outcomes. In general, Commerce Queensland claimed that the best way for work and family balance to be progressed is through a flexible workplace relations system.

For further information or to obtain a copy of the submission please contact Nick Behrens, State Manager – Policy, at nbehrens@commerceqld.com.au.

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The Australian Government has indicated that it will expand the obligations of employers that employ individuals under temporary working visas, including the 457 visa. Commerce Queensland has been advised that the new obligations are likely to be similar to those proposed by the previous Government in its Migration Amendment (Sponsorship Obligations) Bill 2007 which was introduced, but not passed, before the last election.

Employer obligations under that Bill were going to include payment of:

• a minimum salary level;
• all costs associated with the recruitment of the sponsored worker;
• fees for any mandatory licence, registration or membership that the sponsored worker needed to work; and
• medical and travel costs.

Private sector estimates at the time suggested that the additional obligations could increase the cost of employing a foreign worker by almost 45 per cent, which could prevent some businesses from engaging suitable workers and impacting on growth.

Commerce Queensland believes that the new Bill will be broader than the 2007 Bill as it will apply to all temporary visa categories. It is also likely that the Bill will require the minimum salary level to be indexed to CPI and improve the investigative powers of the Department, including greater access to ATO information.

The new changes will also include a comprehensive information strategy for employers and employees. On a positive note, the Bill is likely to introduce a new category of visa for skilled migrants coming to Australia for less than three months.

For further information please contact Nick Ferris, State Manager – International Business, at nferris@commerceqld.com.au.

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Commerce Queensland has several reservations regarding the measures put in place for streamlining the 457 visa application and approval processes, and for eliminating duplication and unnecessary administration.

Commerce Queensland has reviewed the recommendations of the 457 External Reference Group's Inquiry and the subsequent response by the Department of Immigration and Citizenship (DIAC).

The key measure to establish only in Sydney, Melbourne and Perth specialised teams or 'Centres of Excellence' to facilitate and process 457 visa applications has met with a mixed response from Queensland industry.  In our view this outcome creates concerns that through the absence of a centre in Queensland the objectives of making the 457 visa scheme more effective and responsive to industry needs in Queensland will be compromised.

Commerce Queensland will monitor closely this recommendation to gauge whether responsive servicing and a reduction in backlogs occurs for this State.  Commerce Queensland is keen to ascertain what measures can be put in place by the Department to ensure that employers in Queensland are not disadvantaged in any way through lack of an office in this State.

For further information please contact Jillian Fairbrother, Policy Research Officer, at jfairbrother@commerceqld.com.au.

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Commerce Queensland President, Beatrice Booth, has today endorsed the position taken by ACCI President, Peter Anderson, and ACTU President, Sharan Burrow, on the subject of responses to the climate change debate.

Mrs Booth, who is also Chair of the ACCI Environment Policy Committee and Deputy Chair of the Employment, Education and Training Committee, supports the argument that global and multilateral solutions need to be sought, while noting practical and local measures in households and workplaces are available.

In the Financial Review (17/6/2008), Peter Anderson and Sharan Burrow state there are serious costs and risks depending on the nature of government responses, and note these need to be economically responsible. The article highlights the issue of jobs, especially those in carbon-exposed industries. More.

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The Queensland Competition Authority has released its final decision for an increase to the Benchmark Energy Retail Cost Index for 2008-09.

The increase is 5.38 per cent, well below the 7.01 per cent originally proposed increase that Commerce Queensland argued strongly against.  Our opposition to the proposed increase focused on the competitiveness of Queensland electricity prices and linking any increase with improved performance from the Queensland Electricity Supply Industry.

Given the prevailing conditions in Queensland's Electricity Market, the outcome of a 5.38 per cent increase for 2008-09 is considered to be reasonable.  This increase does however come on top of the 11.3 per cent increase for 2007-08.

It is unfortunate that another rise in electricity prices comes at a time when the Queensland economy has softened due to a significant deterioration in business and consumer confidence caused by rising cost pressures including fuel prices, higher interest rates, inflation, increasing global and domestic market instability.

This inquiry is particularly important for regional Queensland businesses where competition has been slower to emerge.

Commerce Queensland believes that a more modest increase in the BRCI would have provided a solid foundation for further economic growth in the State, however recognises the realities of the prevailing market and climatic conditions.  It does nevertheless remain essential that the State's pricing regime continue to be competitive with reliability improved.

For further information please contact Nick Behrens, State Manager – Policy, at nbehrens@commerceqld.com.au.

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